What: All Issues :
Fair Taxation :
Corporate Tax Breaks, General :
A procedural vote on a Republicans petition to end a Democratic filibuster (extended debate) on a Republican motion to send back "The Jumpstart Our Business Strengths (JOBS) Act" (S. 1637) to its committee of origin, with instructions for the Finance panel to incorporate into the bill a series of tax breaks for big corporations.

Who:
All Members

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A procedural vote on a Republicans petition to end a Democratic filibuster (extended debate) on a Republican motion to send back "The Jumpstart Our Business Strengths (JOBS) Act" (S. 1637) to its committee of origin, with instructions for the Finance panel to incorporate into the bill a series of tax breaks for big corporations.

The World Trade Organization (WTO) has ruled that the United States cannot, under a U.S. tax law called the Foreign Sales Corporation/Extraterritorial Income (FSC/ETI), tax income from exports at a lower rate than other forms of business income. As a result of the WTO ruling, the European Union on March 1, 2004, was allowed to begin imposing additional taxes on American exports. The Jumpstart Our Business Strengths (JOBS) Act (S. 1637), co-sponsored by Sen. Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee and Sen. Max Baucus (D-Montana), ranking member of the Senate Finance Committee was designed to change U.S. tax law to bring it into compliance with WTO agreements and stop the burdensome tariffs being imposed on U.S. manufacturers - a goal that appeared nearly universally share by members of various political stripes. To bring the U.S. into compliance and remove these additional taxes, Congress was forced to repeal the provisions that offended the WTO. But while virtually every policymaker agreed that repealing the FSC/ETI law would be appropriate, the battle in Congress has been about how to use the $50 billion of increased tax revenue that resulted from eliminating the export preference. Conservatives believed the money should be used for business-related tax cuts, and the House and Senate Republicans took pains to choose from the many competing options. Both the House and Senate chose to devote most of the tax revenue windfall in their respective bills to special tax preferences for domestic manufacturing, leading progressives to gripe about the bills' numerous "pork" provisions that benefit narrow interest groups. Progressives argued that an important bill had become a vehicle for wasteful spending and tax breaks for special interests and the super rich. Among the provisions singled out for criticism was a $35 million tax break backed by House Speaker Dennis Hastert (R-Ill.), which specifically would eliminate the excise tax on fishing tackle boxes. One of the biggest beneficiaries of that tax break would be Plano Molding Co. of Illinois. The company, headquartered in House Speaker Dennis Hastert's district, has been making plastic fishing-tackle boxes for more than 55 years. Although conservative proponents of the bill pointed out that it is ``revenue neutral'' and that all of the tax cuts in the bill are paid for with offsets, many progressives argued that, due to our current fiscal crisis, any proposed offsets should simply be used to reduce the deficit. With this debate as a backdrop, Senate Republicans during floor debate failed to invoke cloture on a motion to recommit (send back) the JOBS bill to its committee or origin, with instructions for the Finance panel to incorporate into the bill a series of changes wanted largely by conservative members. Because of the nature of those proposed additions, and because the cloture petition's approval would have prevented debate on a number of amendments that progressives felt deserved to be voted upon, progressives opposed the motion. The motion subsequently failed in a 50-47 vote, falling 10 votes short of the 60-vote threshold, therefore the FSC/ETI repeal measure failed.